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The global smart airport market size was USD 2.20 billion in 2019 and is projected to reach USD 6.70 billion by 2027, exhibiting a CAGR of 17.24% during the forecast period.
The global market has grown considerably with the introduction of innovative technologies that have enhanced passenger experiences. The increase in demand for real-time data is driving the market growth. It helps to ease the burden on airport infrastructure and the workforce. The key growth drivers comprise of modernization of previous airports, development in commercial aviation, the establishment of new airports, and an increase in the number of green initiatives by the airports. The key motive of building a smart airport is to create systems and processes, digitally equipped and arranged in terms of process efficiency and connectivity for airport operations.
The introduction of various electronic devices with innovative options, such as passenger identification through a unique heartbeat pattern, the assistance of biometric signatures, and the preparation of artificial intelligence technology across airports, are assisting the management of huge airport databases.
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Implementation of Biometrics at Airports is a Prominent Trend
Facial recognition technology is becoming increasingly popular in international airports, as well as domestic airports across the globe. This technology eliminates paper and conventional data recording systems and provides a better boarding experience. It was mainly used for check-in and exit checks, but with the advancement in technology, it has been adopted by individual airports for boarding processes. The solutions such as self-service offer a user-friendly experience. This enables high-level automated security checks at green airports.
In 2019, Brisbane Airport implemented the smart path biometric technology with Air New Zealand passengers. This airport was the first to trial the seamless boarding experience. By the end of 2020, The Government of Australia has announced plans to automate over 90% of the air travel processing.
Growing Air Passenger Traveling Developed Countries to Boost Growth
The growing commercial aviation domain and the rising preference of people to air travel across the globe are expected to boost the growth of the smart airport market during the forecast period. According to the International Air Transport Association (IATA), an additional 44% of air passenger traffic is expected to come from China and India in the next ten years. In addition, Asia Pacific is expected to be the fastest-growing region for air passenger travel in the next decade. Governments in the developed countries are looking forward to investing in green airports and smart airport initiatives to reduce the adverse effects on the environment. Moreover, smart parking is an evolving concept in these airports. Thus, this will propel the growth of the market.
Rising Focus on Customer-Centric Approaches to Propel the Growth of the Market
Governments in developed countries are designing and developing smart airports with the collaboration of key companies. The advanced technologies installed at airports will simplify the passenger traveling experience at the airports. Airports are upgrading their conventional systems with highly advanced and automatic systems to reduce the waiting time of passengers. The growing demand for eco-friendly systems and airports will also propel the demand for green and smart airports in the upcoming years. Thus, this factor will propel the smart airport market growth.
High Costs of Advanced Smart Airports and Components to Hinder Growth
Advanced and automated security systems simplify the process of boarding at airports. However, high costs involved in the design, development, and implementation of digitalized systems at the airports would restrain the market growth. They require a combination of various subsystems and electronic components to provide real-time data to the airport authority. The development, launch, and maintenance of these digital systems are costly. Due to the high cost of these systems and services, the airport authorities prefer to outsource the security services from third-party service providers such as Securitas AB, G4S Plc, and others. Therefore, both cost and time, that are required for the installation, development, and deployment of digital technologies at airports would prove to be a hindrance to the growth of this market across the globe.
rising demand for Real-Time Information Related Software to Propel Growth of Software Device Segment
Based on the platform, the market is classified into hardware systems, data management, software systems, and others. The software systems segment is anticipated to grow at the fastest CAGR during the forecast period. Increasing demand for face detection and real-time information software at smart airports are the major factors behind the growth of the market. The hardware systems segment was the largest in 2019, owing to the huge investment in biometric systems, baggage handling, security scanning, and the demand or other hardware devices by countries such as the U.S., China, Singapore, and the UAE.
Airport 4.0 Segment to Grow Rapidly Owing to its Ability to Integrate Digital Ecosystems
Based on the airport model, the market is segmented into airport 2.0, airport 3.0, and airport 4.0. Among these, the airport 4.0 segment is expected to be the fastest-growing segment in the market during the forecast period. Airport 4.0 focuses on the connectivity and real-time information by connecting all stakeholders in an integrated digital ecosystem. The airport 2.0 segment was the largest segment in 2019 owing to the rise in the demand for smart airports and huge demand for the Internet of Things (IoT)-based systems and equipment.
High Demand for Advanced Systems in Airports to Favor Growth of Large Segment
Based on airport size, the market is segmented into small, medium, and large. Among these, the large segment is expected to be the fastest-growing segment of the market during the forecast period. This growth is attributed to the increasing demand for the installation of advanced systems in the airports and the high demand for customization of the systems across the globe. In contrast, the medium segment was the largest in 2019.
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Increasing Demand for AI-based Systems to Drive Growth of Terminal Side Segment
Based on the application, the market is divided into the airside, landside, and terminal side. Among these, the terminal side segment is expected to be the fastest-growing segment in the market during the forecast period. This growth is attributed to the increasing demand for the installation of artificial intelligence-based advanced systems and equipment on the terminal side of airports. In contrast, the airside segment was the largest in 2019.
Being a Major Revenue Source, Non-aeronautical Segment will Grow At a Fast Pace
Based on airport operation, the market is bifurcated into aeronautical and non-aeronautical. Among these, the non-aeronautical segment is expected to be the fastest-growing segment in the market during the forecast period. According to our research study, due to the COVID-19 pandemic, airports across the globe have exhibited a drastic decline in passenger traffic in the 1st quarter of the year 2020. non-aeronautical revenues play a crucial role, as they alone cannot serve all airport operations and capital costs. For some key airports in Asia Pacific, non-aeronautical revenues are the principal revenue source. For Instance, Asia-Pacific airports derive more than 45% of their revenues from the non-aeronautical domain. The sudden drop in passengers has a significant impact on the ecosystem comprising of airports, airlines, suppliers, and service providers. Whereas, the aeronautical segment was the largest in 2019.
North America Smart Airport Market Size, 2018 (USD Billion)
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As per our research, North America is estimated to hold the largest share of USD 1.28 billion in 2019 and is also expected to be the fastest-growing region during the forecast period. The U.S. has significantly increased spending on modernizing its airport systems in recent years. In addition, the presence of key manufacturers such as Honeywell International Inc. and Raytheon Technologies Inc., as well as the governing agencies such as the Transportation Security Administration (TSA) are driving the market growth in the U.S. Moreover, the presence of the biggest international airport named Hartsfield-Jackson Atlanta International Airport (ATL) will propel the growth of the market in this region.
Europe held the second-largest market share in 2019 owing to the high investment in the up-gradation of conventional systems with technologically advanced systems and the rising demand for smart and green airports in the upcoming years. The European Union Agency for Cyber-Security (EUAC) is actively involved in designing, developing, and implementing cyber-security-based systems at these airports. It will boost the growth of the market in this region.
Asia Pacific held the third-largest share in 2019 and is also expected to be the fastest-growing region during the forecast period. The region is expected to showcase strong growth in the market during the forecast period owing to a significant rise in the air traffic in countries such as China, Singapore, and India. The region is anticipated to exhibit long-term growth in the market.
Furthermore, the market in the Middle East and Africa is anticipated to increase at a significant CAGR, owing to the presence of a considerable number of suppliers and distributors of smart airport systems in this region. Similarly, increasing investment in the domestic airports in the UAE and Saudi Arabia in the region is expected to drive the market in the Middle East and Africa.
The Collaboration of Government Agencies and Key Companies to Propel Growth
The competitive landscape of the smart airport market depicts the domination of selected players such as Thales Group, Honeywell International Inc., and Raytheon Technologies Inc. These companies are focusing on designing and developing advanced autonomous eco-friendly solutions for these airports. Moreover, they are set to expand their geographic reach in the Asian countries in the near future. They are also collaborating with the government authorities to built smart airports in the respective countries. Moreover, European agencies are actively involved in designing these airports in the next ten years.
The smart airport market report offers qualitative and quantitative insights on the market and detailed analysis of market size & growth rate for the segments in the market.
An Infographic Representation of Smart Airport Market
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Along with this, the report provides an elaborative analysis of the market dynamics, emerging trends, and competitive landscape. Key insights offered in the report are the adoption of advanced technology, recent industry developments such as partnerships, mergers & acquisitions, consolidated SWOT analysis of key players, Porter’s five forces analysis,business strategies of leading market players, and macro and micro-economic indicators.
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Value (USD Billion)
By Airport Model
By Airport Size
By Airport Operation
In 2019, the market was USD 2.20 billion, and it is anticipated to reach USD 6.70 billion by 2027, growing at a CAGR of 17.24% during the forecast period (2020-2027).
In the market, airside systems is the leading segments.
Some of the driving factors for thegrowth of the market are increasing air passenger travel in the developed countries and rising focus on customer-centric approaches.
In the market, some of the key players are SITA, Huawei Technologies Co., LTD., and Honeywell International Inc.
In the market, key players are mainly focusing on establishing a strong supply chain network in high growth regions such as Asia-Pacific. They are also involved in acquisitions and technological collaborations to strengthen their position.
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